October sellers struggle to adjust to new market conditions

October sellers struggle to adjust to new market conditions

The Rightmove House Price Index for October 2010 shows “bullish” pricing in the face of tight mortgage availability and increasing numbers of properties on the market.
The average national asking price increased 3.1% to £236,849 although market fundamentals remain poor. Properties per branch rises from 69 in October last year to 78 now and mortgage availability continues to deteriorate. However, 105,769 new October sellers asked a seemingly illogical £7,082 more for their homes than last month’s sellers.
Why would new sellers test the market at asking prices 3.1% higher than a month ago? Bullish pricing is a normal characteristic of the autumn selling season with average asking prices increasing in every October for the past decade. Vendors seem to be struggling to react to the increasing stock as most are unwilling or unable to adjust to new market conditions. Furthermore, now that Home Information Packs have been scrapped, speculative sellers can test the market at minimal cost, leading to general price inflation.
Conveyancers will question whether this signals extra abeyance cases.

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